Disney Interactive is laying off 700 people

Disney Interactive has announced that 700 jobs will be eliminated, which is around 26% of their staff. These cuts were expected and will mostly affect the Disney Playdom group. Playdom creates games for social media platforms and mobile devices. Disney Interactive is going to develop fewer mobile and social games in-house, but will continue to license games from development partners.
“Disney Interactive has consolidated several lines of business as part of an effort to focus the division on a streamlined suite of high-quality digital products,” said Disney in a statement. “As a result of this restructuring, we have undergone a reduction in workforce. These actions were difficult but necessary given our long-term strategy focused on sustainable profitability and innovation.”

Disney Interactive is led by Jimmy Pitaro. John Pleasants stepped down from the co-president position after the launching of “Disney Infinity” last year. Disney Infinity was rather successful as it sold over 3 million copies since launching in August 2013.

Disney Interactive oversees Disney.com and other Disney websites. Disney is also going to shut down BabyZone and Spoonful. BabyZone is a blog for new moms and Spoonful is a blog about foods. Disney will also shut down the Playdom games Sorority Life and Alice in Wonderland. The mobile games Where’s My Water?, Where’s My Mickey?, and Tap Tap Revenge will also be shut down.

Disney Interactive acquired Playdom for $563 million in 2010, but struggled to establish their social game franchises since then. “Marvel: Avengers Alliance” is doing well as it has 3.9 million fans on Facebook. Disney Interactive is going to shut down offices in Chicago, New Jersey, Colorado, South Korea and Hyderabad, India.